JAKARTA, INDONESIA – JANUARY 2: Citizens are seen crossing the road during rush hour on January 2, 2023 in Jakarta, Indonesia.
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Despite a slowdown in global IPOs in the first half of 2023, Southeast Asia’s IPO market shows promising signs, a firm says New Deloitte Report.
Over the past six months, there have been 85 IPOs in Southeast Asia, raising $3.3 billion, compared with 73 IPOs raising $3.1 billion in the same period last year. This implies a 16% increase in the number of IPOs and a 5% increase in earnings in the first half of 2023.
“Southeast Asia’s positive growth prospects make the region a favorite among investors as foreign direct investment continues to flow in as the region reopens, tourism recovers and domestic demand booms,” the report said.
“These factors have combined to contribute to positive economic growth in the region despite global economic uncertainty.”
There remains a wealth of exciting opportunities and healthy deal flow in regional capital markets for investors to explore and capitalize on.
This increase was largely attributable to three IPOs in Indonesia, each raising more than US$500 million, compared to just one blockbuster IPO — gothe combined entity of Gojek and Tokopedia — valued at $1 billion a year earlier.
Meanwhile, the tech-heavy Nasdaq hasn’t seen a notable venture-backed tech IPO since the software provider. hash company Debut in December 2021.
In the first half of 2023, global IPOs will continue to slow down, and the number of IPOs will decrease by 5% compared with the same period last year. Ernst & Young Report revealed. Earnings plummeted 36% year over year.
Indonesia’s rising star
In the first half of 2023, funds raised in Indonesia accounted for 70% of the total funds raised by IPOs in Southeast Asia.
The IPO market in the world’s fourth most populous country was highlighted by three listings: nickel company PT Trimegah Bangun Persada Tbk, minerals and electric vehicle battery materials company PT Merdeka Battery Materials Tbk and geothermal power plant operator PT Pertamina Geo Thermal Energy Tbk.
Indonesian President Joko Widodo has taken steps to position the country as a global hub for the electric vehicle supply chain, including Signed an agreement with Australia to collaborate on key electric vehicle production minerals lithium and nickel.
How Southeast Asia’s economic recovery will weather the storm remains to be seen.
“Indonesia has the world’s largest nickel reserves and the recent IPO of Harita Nickel (PT Trimegah Bangun Persada Tbk) is a good example of local and international investor interest,” Deloitte said.
Deloitte said Indonesia is “on track for its best year ever with 44 IPOs in the first half of 2023”.
Thailand and Malaysia follow with 18 and 16 listings in the first half of 2023, respectively.
“With pro-growth policies, stable macroeconomics and healthy demographics across Southeast Asia, coupled with the growing investment influence of tech entrepreneurs and strong trade ties with China, there remains plenty of excitement in regional capital markets opportunities and a healthy deal flow for investors to explore and capitalize on,” Deloitte said.
However, Deloitte said the company remained “cautiously optimistic about the region’s outlook” in the second half of the year.
“How Southeast Asia will weather the storm of economic recovery remains to be seen,” Deloitte said. Uncertainties such as interest rate hikes, banking problems and inflation continued to weigh on the economy, the firm said.
this IMF expects growth to slow in Southeast Asia From 5.7% in 2022 to 4.6% in 2023. The group pointed to slightly slower domestic demand in Malaysia and Thailand, moderating commodity prices in Indonesia and Malaysia, and weaker external demand in the United States and Europe.
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